How we can become stronger, faster and better together in 2022

Written by Mark Perera, CEO, Vizibl

Having observed the procurement and supply chain profession for many years I have witnessed first-hand the challenges faced, which in recent times have multiplied and grown exponentially. From mounting investor pressure and changing consumer demands, to global supply chain crises, rampant scope 3 carbon emissions, and of course the impact of the pandemic.

We must become stronger together

Recent years have demonstrated just how sensitive to disruption businesses can be. Widespread supply chain crises – exacerbated by volatile geopolitical developments, lean just-in-time supply chains, and the COVID-19 pandemic – have wreaked havoc for businesses looking to ensure supply and safeguard their continuity of operations.

These challenges are not going away soon. With the emergence of the Omicron variant, we find ourselves facing yet more disruption, and a very stark reminder that we are still firmly mired in the COVID-19 pandemic. Alongside coronavirus, we face another existential threat to people, planet, and business: the escalating climate crisis. Expanding natural resource shortages, intensifying regulatory pressure, and escalating competition for scarce sustainable materials and logistics will present yet more hurdles for burdened businesses and stretched supply chains to overcome.

To weather the storm, we must find opportunities to become more resilient. In these times of disruption and shortage of supply, it has never been more important to forge deep, secure relationships with key suppliers to become their ‘customer of choice’. Customer of choice status puts procurement in a privileged position with a given supplier, offering priority access to new innovation and existing IP along with preferential pricing, and encouraging better cooperation and collaboration on supply chain sustainability initiatives.

We can go faster together

But increasing resilience alone won’t suffice. Businesses are also under pressure to find novel solutions to grow more rapidly, eliminating inefficiencies and waste along the way. In this situation, we must turn to innovation, science, and technology to pave the way and save the day.

While it may be small comfort, the past 18 months have shown us how much we can accomplish – and at breakneck pace – if we collaborate to find solutions. When the WHO declared COVID-19 a pandemic on the 11th March 2020, very little was known about the virus – how to treat it, its long-term side effects for individuals, or the utter devastation it would wreak on fragile economies and global public health. Yet within 24 hours of the coronavirus genome being made publicly available, a vaccine development team at Oxford, led by Dame Sarah Gilbert and Dr Catherine Green, had designed a vaccine that would protect against its worst effects.

But their work wasn’t the end. We must also thank the scientists who conducted large-scale clinical trials, the regulators who found innovative ways to remove inefficiencies from complicated approvals processes, and every actor in the supply chain required for its complex manufacturing, production, and eventual deployment by AstraZeneca. That enormous collaboration is now saving millions of lives around the world, at cost.

The problem was gargantuan, and it needed to be remedied as rapidly as possible. Collaborative innovations in science and technology came to our rescue. In 2022 I hope businesses seek to apply this ‘many heads are better than one’ logic by collaborating with suppliers and partners to stamp out inefficiencies and find innovative solutions to their most challenging problems.

We need to do better together

Being stronger and going faster have always been mainstay ambitions of organisations. But now we must grow and accelerate in a way that is sustainable.

We are facing a very real, very fierce fight to protect people and planet. We are projected to overshoot the Paris Agreement’s target to limit global warming to 1.5˚C, and with the vast majority of corporate emissions originating in the supply chain, we stand no chance of meeting this goal unless we work together.

But emissions aren’t the only area in which we need to drive vast improvement – sustainability encompasses the entire ESG agenda. In addition to emissions, we need to turn our attention to other impacts we have on the world around us. This includes stamping out any chance of child labour or modern slavery in our supply chains, striving for a global fair living wage, ceasing to rely on unsustainable, finite resources, minimising and handling our waste better, and moving from a linear to a circular economy. These goals cannot be achieved in a vacuum, and they will not solve themselves without action.

The procrastinating needs to stop. The balance must shift away from spending most of our time running the numbers over again and not actually doing anything. This change must be driven hard by all of us – not only as business professionals, but as individuals – citizens, and consumers.

Why we need multiple platforms to address sustainability goals

And finally, while the momentum in sustainable procurement will continue to accelerate exponentially, this will be coupled with demand for digital solutions to enable and scale these efforts.

In the last 3 months alone, the number of LinkedIn members listing Sustainable Procurement as part of their skillset or role has grown from 275,000 to over 320,000. Given the increased corporate and investor focus on addressing our full impact on the environment, this is hardly surprising: the average enterprise company’s carbon emissions – usually more than 80% – sit in the supply chain – and this is challenging and multi-faceted to address.

Organisations that prioritise sustainability targets above cost savings in employee assessment will ensure they are driving the right behaviours to support sustainable business outcomes. However, the sheer volume of suppliers plus the extent of the data and carbon calculations required is overwhelming, threatening organisations with analysis paralysis when urgent action is needed. To combat this challenge, technology should be deployed to enable organisations to manage the sheer scale of required activity and analysis.

Despite this need for technology enablers, platforms are in short supply and frequently offer limited functionality; analyst market guides for supplier sustainability applications highlight the lack of comprehensive applications available to tackle the full sustainability agenda. As a result, businesses are likely to need multiple platforms to address their sustainability goals. This might entail a combination of sustainability data aggregators, responsible sourcing solutions, and a Supplier Collaboration & Innovation platform to manage close collaboration with incumbent suppliers and to open-source sustainable transformation through innovation in as-yet undiscovered suppliers and partners.

As we look to navigate increasingly turbulent times and captain our organisations through these challenges, all of the elements I’ve highlighted above will be critical as we head into 2022 and beyond.